We noticed you're blocking ads.

Keep supporting great journalism by turning off your ad blocker.

Questions about why you are seeing this? Contact us

Font Size

- Aa +

Wed 26 Sep 2007 09:34 PM

Font Size

- Aa +

Iran shrugs off French call for boycott

Iran will go it alone on gas project if Total bows to political pressure, Oil Minister Nozari says.

Iran will carry out a multibillion dollar gas project without Total if the French oil major bows to political pressure to steer clear of the Islamic Republic, the country's oil minister said on Wednesday.

French President Nicolas Sarkozy called earlier this week for tougher international sanctions against Iran's nuclear work and warned Total and gas firm Gaz de France to refrain from investing in Opec's second-biggest producer.

"We have a message for Sarkozy," said caretaker Oil Minister Gholamhossein Nozari. "If Total does not come, the powerful hands of Iranians will carry out Pars LNG."

So far there was no indication the French company was pulling out of the Pars liquefied natural gas (LNG) project, said Nozari. But a price in excess of $11 billion quoted by Total was too high for Iran, he told a news conference.

"Our talks with Total continue. And Total is interested and is actually insisting on this project. The problem is the amount suggested by Total," he said.

"Now... we do not agree with the price they have given us."

Pars LNG, the country's first LNG export terminal, would be fed by developing part of the giant South Pars gas field.

Iran said the project was worth $2 billion in 2004 when Total agreed to the deal, but construction costs have spiralled thoughout the energy sector since then. The terminal was due to start up in 2009, but that date has been pushed back to 2011.

Nozari said it was in Total's best interest to invest in Iran, home to the world's second-biggest gas reserves after Russia, and that Tehran would not tolerate a slow approach.

"Total is a big company which needs reliable resources to stay in the market. And Iran is an energy-rich country," he said. "We are not going to deprive anyone from any project, but we are not going to delay any project if someone does not come."

He said one proposal was to break the project into smaller packages to encourage competition. - Reuters

Digital magazine: Read the latest edition of Arabian Business online

For all the latest energy and oil news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.